Business Studies – IGCSE

0450

1.1 – Business Activity

1.1 – ASSESSMENT
OBJECTIVES

1.1.1 - The purpose and nature of business activity:

• Concepts of needs, wants, scarcity and opportunity
cost
• Importance of specialisation
• Purpose of business activity
• The concept of adding value and how added value
can be increased
 ASSIGNMENT SCENARIO
 For this project you will need to select a company that produces or
provides a range of products or services that employs at least 10
members of staff with a varied job range.
 Ideally this company should have a production, distribution and sales
side to it so that the staff employed do different work tasks, share
resources among departments and should have rivals.
 It can be within any industry, a shop that sells, a company that
provides help and support packages, a delivery company, a restaurant
or food shop but preferably not a franchise as this makes it difficult
when it comes to rules and regulations that apply.
 You can make up the company as long as you use the above
guidance to set the limits of what the company does and sells. If you
choose a company, it should be one you are familiar with and can
research things like ownership, grants, staffing issues and laws that
apply.
HOW TO ANSWER A PAPER 2
QUESTION
1 – Definition 2 – Application 3 – Analysis 4 - Evaluation
In relation to XXXX, the YYYY (DEFINITION) is relevant (APPLICATION) to the business
by…
This means that … (ANALYSIS)
Therefor …. (BALANCE FOR ANALYSIS)
However …. (BALANCE FOR ANALYSIS)
Based on the evidence provided in the Case Study, I would agree/disagree about XXXX
because …. (Evaluation)
Example:
Q1 – Haltec, a computer company has decided to market the release of a new brand of gaming
mouse. In your opinion, how could they use Product as their unique selling point.
A1 – In relation to the Product, marketing that is aimed at emphasizing the quality of the product
as the best thing about it, this means that Haltec would show the quality in advertisements like
magazine adverts. Therefor the audience would be made aware of the good points like size,
speed, ability. However this may conflict with its price or the place where they advertise.
Based on the evidence provided in the case study, I would agree that if the product is of good
quality then using Product as the USP would benefit the company more than the other P’s in
marketing as this is what the customers will look for in computer equipment.
1.1 – GLOSSARY
These are the technical terms you will need to know for the exam. Add them to your
own Glossary.
Added value – the difference between the selling price of a product and the cost of raw
materials used to make it
Effective demand – demand for a product that is backed up by the ability and willingness to
pay for it
Factors of production – the four categories of resources that are used to produce goods and
services: land, labour, capital, enterprise
Goods- tangible products that can be touched and consumed
Needs – things necessary to sustain life
Opportunity cost – the cost of something in terms of the next best thing
Private sector – the sector of business consisting of businesses owned by private individuals or
groups
Profit – the profit a business makes is the amount by which its income from selling the goods
and services it produces exceeds the costs of producing those goods and services
Public sector – the sector of business consisting of businesses owned by the state
Resources – items of limited availability that can be used in human activity
Services – things other people or businesses do for you
Wants – things chosen to satisfy a need or to make life more enjoyable
1.1.1 – CONCEPTS OF NEEDS AND
WANTS

Needs What it is that a

business wants
to achieve and
how they go
Clothing Food Shelter about getting
that.
Who makes the
products
Wants companies sell.
What else a
boss wants
from the
Clothing Shelter Food company.
Does image
matter
Jeans House Burger Why do similar
companies sell
more or less of
the same
Party Dresses Apartment Pizza products.
1.1.1 – CONCEPTS OF NEEDS AND
WANTS
• What we need and what we want can sometimes be confusing.
• Often you say you need a new Smart Phone or Trainers when in fact you want it
rather than need it.
• Needs – The concept of a ‘Need’ is something that you have to have to
survive, a daily essential. Food, Water, Shelter, Clothing.
• Wants – Is something that we desire, something that makes life easier or
helps us progress, that does not mean selfish but can mean more efficient.
• Wants and needs do not have to be material, they do not have to be objects
to possess or use, they can be ideas, plans, skills.
• For certain things Needs outweigh Wants, a company needs ingredients or
raw materials to make a product and those items are obvious, dough,
cheese, toppings and heat from an oven to make a pizza and common
needs. Is there something from that list that could be done without, if so,
that is a ‘Want’ not a need.
1.1.1 – CONCEPTS OF NEEDS AND
WANTS
• What is the main difference between needs and wants?
• For your Business make two lists: the first showing the things
that your Business needs on a day to day basis to operate, think
about how the average Business Day runs; the second listing
things that your Business would want.
• Identify 3 kinds of businesses or organisations that supply each
item on your lists.
• Select two businesses that you have identified and explain why
you think that they supply the item, why do you think they
specialise in making that item.
1.1.1 – CONCEPTS OF NEEDS AND WANTS -
SCARCITY
1.1.1 – CONCEPTS OF SCARCITY -
ACTIVITY
• Since resources to produce goods and services are scarce a choice
must be made to decide what to produce from them.
• For example, furniture and houses can be made from timber so a What else can be
decision needs to be made whether to cultivate trees for furniture scarce that
affects a
or houses. Business
• Similarly, if a government spends too much money on building
Can scarcity be
skills then it will not be able to spend much on training extra temporary.
doctors. What alternative
• Activity – In groups discuss and prepare a presentation on how a resources can be
scarcity of a certain raw material could impact on the production used during a
of your products within a country. You should go beyond the scarcity.
obvious for this, think of the short, medium and longer term What scarcities
implications and cascaded impact on reliant businesses. can be predicted
What resources
are guaranteed to
be more scarce in
the future.
How does
Scarcity impact
on Product price
1.1.1 – CONCEPTS OF
OPPORTUNITY COST
• Opportunity cost of a choice is the value of the product you did not choose
due to cost, where a choice needs to be made between several alternatives
given limited resources. Assuming the best choice is made, it is the "cost"
incurred by not enjoying the benefit that would be had by taking the second The range of
best choice available or the "loss of potential gain from other alternatives products on the
when one alternative is chosen". market for one
• The principle of opportunity cost helps ensure that scarce resources are used purpose.
efficiently. Why companies
• Opportunity costs are not restricted to financial costs, it also includes the would
cost of output forgone, lost time, pleasure or any other benefit that provides deliberately
benefits should also be considered opportunity costs. produce inferior
• If you want an iPod and a pair of shoes but only have enough money to buy products.
one of them, you will have to choose which one to buy. Both products cost How they
money and that is their financial cost. promote these to
• There is also an opportunity cost – the possibility of buying and enjoying the get your sales.
use of the other item. If you buy the iPod, the opportunity cost of the iPod is Who owns these
the shoes. If you buy the shoes, the opportunity cost of the shoes is the iPod companies.
• If a gardener decides to grow carrots, his or her opportunity cost is the
alternative crop that might have been grown instead (potatoes, tomatoes,
What happens
when a lesser
pumpkins, etc.)
product becomes
more popular.
1.1.1 – CONCEPTS OF OPPORTUNITY COST –
ACTIVITY 1
• Opportunity cost is not easy to grasp at first but think of a time when you
could not afford something and had to settle for something else, either
because of a lack of money, time or opportunity.
• Answer the following questions: The range of
• What was the situation that stopped you buying or using the primary products on the
product? market for one
1. What alternatives were available? purpose.
2. Which alternative did you choose? Why companies
3. How much money or time did you save? would
4. Did you ever choose that alternative again as a primary choice when the deliberately
Opportunity Cost was no loner there? produce inferior
5. How do you think the company who produced the alternative, lesser, products.
product marketed their product as the alternative to your choice? How they
6. Of the 4P’s (Product, Place, Price and Promotion) which did they use to promote these to
capture your sales attention? get your sales.
7. Can you name any product that is sold as “Opportunity Cost” that is made Who owns these
by the same company as the preferred choice? companies.
8. Why would a company do this?
What happens
when a lesser
product becomes
more popular.
1.1.1 – CONCEPTS OF OPPORTUNITY COST –
ACTIVITY 2
• Kuwait Petroleum Corporation (KPC) is one of the world’s largest oil
companies. The company makes products such as petrol and diesel from
crude oil. Crude oil is oil in it’s raw or natural state. It occurs naturally in
deposits within the earth. To produce the petrol that people buy from The range of
products on the
garages, KPC must first extract the crude oil from the earth. The company
market for one
does this by drilling oil wells, many of which are under the sea. KPC then
purpose.
transports the crude oil to oil refineries where it is turned into petrol or
other oil products customers want. Why companies
• Individually answer the following questions: would
deliberately
1. What does KPC produce?
produce inferior
2. Does KPC produce goods or services? products.
3. Where can you buy KPC’s product?
4. What is KPC’s product made from? How they
promote these to
5. Other than driving, what else could KPC products be used for?
get your sales.
6. Why do you think KPC produces petrol and diesel?
7. What are the Opportunity Cost products? Who owns these
8. Why do people choose one brand of oil over another when it is companies.
refined to the same quality? What happens
9. Use the concepts of cost, ownership, preference, moral, political and when a lesser
environmental, why would KPC products, if they are cheaper, not be product becomes
the sole market trader. more popular.
1.1.2 – IMPORTANCE OF
SPECIALISATION
• Importance of Specialisation – For decades the major companies in the
world made one thing each, that was what they were known for, that was
what they were good at, and that was where their money came from. The range of
Microsoft made operating systems and software. Honda made cars, Apple products on the
made computers, Puma made trainers, Kellogg's made bran flakes. We market for one
could look at the brand names below and say what their specialised purpose.
product was: Why companies
would
deliberately
produce inferior
products.
• Why do companies specialise – How they
o Created demand that is constant promote these to
o Work force that is trained in that production skill get your sales.
o Marketing, promotion, distribution and client base is in place.
Who owns these
o Results in greater efficiency and productivity. Workers don’t have to
companies.
move between jobs. This leads to lower cost of production.
o Time is saved as the workers become for efficient in performing a What happens
when a lesser
particular job, becoming ‘experts’, they commit less mistakes which
product becomes
leads to less wastage. more popular.
o Due to specialisation production level increases which make it possible
to carry out mass production.
1.1.2 – IMPORTANCE OF SPECIALISATION AND
DIVISION OF LABOUR

• Specialisation and Division of Labour – This is a separation of work

process into a number of tasks with each task performed by a separate
person or group. However this does not necessarily lead to a decrease in
The range of
skills. products on the
• Division of Labour raises outpour per person as staff become good market for one
through constant repetition of a task. This gain helps companies lower purpose.
production costs.
Why companies
• Think of a factory making a car. Having one person making the whole would
inside of the car from seats to dashboard to steering etc. would mean deliberately
taking a long time over one car in one place. Then consider one person produce inferior
putting in the seats all day, they will be very good at seat putting by the products.
end of the day, and a master at it after 10 years. How they
• Upsides – Faster production levels, getting the right person for the job, promote these to
Economies of large scale production, time saving, less training, get your sales.
inventiveness of task. Who owns these
• Downsides – Unrewarding and repetitive, people get bored and leave, companies.
little training so the worker is not skilled beyond the task, leads to mass
What happens
produced goods and therefor little variety in products, loss of pride, when a lesser
decline in craftsmanship, reduction of labour mobility. product becomes
more popular.
1.1.2 – IMPORTANCE OF SPECIALISATION AND DIVISION OF
LABOUR - DRAWBACKS

1. Monotony in work - A worker has to do the same small task again and again. Therefore, the
job becomes boring and the worker loses interest in his work. Boredom and monotony create
mental fatigue which ultimately spoils the quality of work.
2. Lack of responsibility - A worker performs only a part of the total job. Therefore, no
individual can be held responsible if anything goes wrong. It is very difficult to fix
responsibility for defect in the product.
3. Greater interdependence - Job, work processes and industries become increasingly inter
dependent due to division of labour. Any problem or defect in one part may cause disturbance
and dislocation in the entire process of production.
4. Loss of job pride - Since every worker produces only a small part of the product, he cannot
take pride in ultimate result. Loss of sense of job satisfaction reduces the involvement of
employees.
5. Reduced mobility of labour - Since every worker specializes in one type of work, he may
find it difficult to procure a job in case of unemployment.
6. Decline in craftsmanship - Division of labour and consequent mechanisation of work reduces
the role of worker in the production process. The tradition of craftsmanship may decline and
the creative instincts of workers may remain unsatisfied.
7. Pollution of environment - Division of labour leads to large scale production in factories.
This leads to pollution of air, water and land. Slums develop near industrial areas.
1.1.2 – IMPORTANCE OF SPECIALISATION AND DIVISION OF
LABOUR - ADVANTAGES

1. Right person in the right Job - Every worker is assigned the task for which he is best suited. This helps to
provide, opportunities for the best use of natural talents as a person performs the job which he likes he gets
pleasure in work and becoming an expert in performing the job.
2. Greater Efficiency - Division of labour helps to increase the efficiency of workers due to two reasons.
First, every worker is assigned a job that suits his skills, experience, training and aptitude.
3. Better Quality of Work - Division of labour not only increases the quantity of work it also improves the
quality of production. Better and modern machines and equipment are used. Better quality products help to
increase the goodwill and profits of business.
4. Saving of time - Division of labour helps to avoid waste of time and effort caused by changes from one
type of work to another. The worker does not have to shift from one process to another.
5. Economies of large scale production - Division of labour facilitates mass production. Large scale
production provides economies in the use of resources, such as raw materials, labour, tools etc. Optimum
use of means of production helps to reduce cost of production.
6. Less learning period - Under division of labour a worker needs to learn only a part of the whole task.
Therefore, lesser time and expenditure is involved in training workers.
7. Inventions and Innovations - A worker doing the same task again and again tries to find new and better
ways of doing the job. Small and simple parts of a task can easily be done by machines. Thus, division of
labour increases scope for inventions and innovations.
8. Wider Market - Division of labour makes available cheaper goods of a wide variety. As a result demand
for goods and services increases.
9. Benefits to society - Society is benefited due to (a) reduced cost on account of large scale production (b)
higher productivity which leads to economic growth (c) employment of unskilled workers and (d) better
quality of goods and services for consumers.
1.1.2 – IMPORTANCE OF
SPECIALISATION - ACTIVITY
• Specialisation and Division of Labour – This task will allow you to discuss
the basics of:
• Outcomes of "cottage industry" process with "division of labour" process in How you are
manufacturing a product improving each
• Outcomes of "cottage industry" process with "division of labour" process in time you do the
manufacturing a product task.
• Job satisfaction of both processes How you are
• Construct wholly or specifically a product using one of two processes. reliant on
• The class will need to be split into teams of three or four with at least one team others to finish
working as independent workers and the other teams working as a team where theirs.
each person in that team will do one part of the task for everyone. We will be How solitary
making a dice using scissors, glue and a pen. work is different
• Group 1 – Independent working, create the dice from start to finish each. from group
• Group 2: work.
• Player 1 - Cuts out the dice template for all members. How you might
• Player 2 - Writes the numbers on the dice in elaborate fashion. prefer to do the
• Player 3 - Glues the dice together. other tasks.
• Player 4 - Optional player, quality control and management of tasks.
How it feels to
• When done you will need to measure how long it took to complete the task,
be judged on
groups against individuals, and test the quality of the finished product, Teams
your own or as
against individuals.
a group.
• Use the following dice template, print it out for the students to use.
1.1.3 – PURPOSE OF BUSINESS
ACTIVITY
• The purpose of all Businesses is to combine the factors of
production to make products which will satisfy peoples wants. Local, National
and Global
These products can either be goods – physical items such as cars
and shoes which we can touch and see – or they can be services, Primary,
Secondary,
such as insurance, tourism or banking. Tertiary.
• Businesses can be small or large, some businesses employ
Public, Private,
thousands of people with operations in many different countries. Shareholder,
• Businesses can be privately owned or state owned, can e owned by PLC.
one person or by shareholders. Services, Sales,
• Whatever the size and whomever owns them, they all have one Charity, Non-
thing in common, they combine factors of production to make profit.
products which satisfy people’s wants. Single shop,
Franchise,
Chain, Web
based.
Factors of Production
Part time, full
time, occasional
or seasonal
Land Labour Capital Enterprise staffing.
1.1.3 – PURPOSE OF BUSINESS
ACTIVITY
• This may seem like something that is completely normal to us, we are
used to it, we see it all around us from the corner shops to the big
business names. However in undeveloped societies businesses do not Local, National
and Global
exist as such. Everyone attempts to do everything for themselves, the
are self-sufficient. Primary,
• With their own plot of land and by their own efforts, such as hunting Secondary,
Tertiary.
or barter, they attempt to survive and produce enough for their own
needs. This is a very basic existence and living standards will be very Public, Private,
Shareholder,
low.
PLC.
• By a slow process of specialisation, people began to concentrate on
Services, Sales,
what they were best at. They then traded those goods for other goods
Charity, Non-
made by people who have different skills. This is called a market profit.
economy.
Single shop,
• Business activity therefor: Franchise,
• Combines scarce factors of production to produce goods and Chain, Web
services. based.
• Produces goods and services which are needed to satisfy the Part time, full
needs and wants of the population time, occasional
• Employs people as workers and pays them wages to allow them to or seasonal
consume products made by other people. staffing.
1.1.3 – PURPOSE OF BUSINESS
ACTIVITY
• Using the heading choose research three businesses for each business
field and explain the similarities in the field they operate and the
differences. Local, National
and Global
Medical Product sales Manufacturing Providing a Service
Primary,
Global Secondary,
Company 1 Tertiary.
Similarities Public, Private,
Shareholder,
Differences
PLC.
National Services, Sales,
Company 2 Charity, Non-
Similarities profit.
Single shop,
Differences
Franchise,
Local Chain, Web
Company 3 based.
Similarities Part time, full
time, occasional
Differences or seasonal
staffing.
1.1.4 – ADDING AND
INCREASING VALUE
• Added value - The difference between the price of the finished
product/service and the production costs involved in making it. How Branding
• This is because of the work carried out increases the value of the links to value
added
parts and raw materials used. When the product is complete its
How marketing
value and the price it is sold at is more than the value of the factors can change the
of production used to make the product. image of a
• Therefor added value is the increase in value that a business creates product.
by undertaking the production process. What a Loss-
Leader is and how
• Consider the examples of new cars rolling down the production line this affects value
being assembled by robots. The final, completed and shiny new car added when
that comes off the production line has a value (price) that is more money is lost in
the sale price.
than the cost of the sum of the parts. Value has been added. Exactly
The loss of
how much added value is determined by the price that a customer customers through
pays. bad customer
• Alternatively, imagine a celebrity chef preparing a meal at his service even when
the product is
luxury restaurant. Once the cooking is complete, the meal is being good.
served and sold for a high price, substantially more than the cost of How some
buying the ingredients. Value has been added. companies benefit
the wider
community as a
value added.
1.1.4 – ADDING AND
INCREASING VALUE
• You don’t have to use robots or have the culinary skills of Gordon
Ramsay to “add value”. Businesses can also add value by:
• Building a brand – a reputation for quality, value etc. that customers How Branding
are prepared to pay for. Nike trainers sell for much more than Hi-tec, links to value
added
even though the production costs per pair are similar.
How marketing
• Delivering excellent service – high quality, attentive personal service can change the
can make the difference between achieving a high price or a medium image of a
one. product.
• Product features and benefits – additional functionality in different What a Loss-
versions of software can enable a software seller to charge higher Leader is and how
this affects value
prices, different models of cars are designed to achieve the same effect. added when
• Offering convenience – customers will often pay a little more for a money is lost in
product that they can have straightaway, or which saves them time. the sale price.
• A business that successfully adds value should find that it is able to The loss of
operate profitably. Remember the definition of adding value - where the customers through
bad customer
selling price is greater than the costs of production. service even when
• Do not confuse added value with profit as they are not the same the product is
good.
How some
companies benefit
the wider
community as a
value added.
1.1.4 – ADDING AND INCREASING VALUE
- ACTIVITY
• Discussion – 2 Groups – One for and one against. Even if you are against or
for, you should be able to create an argument for either side for the sake of
arguing. How Branding
• Would you be willing to pay a bit more for a loaf that has been made at links to value
added
home. Can you say the same for clothes, a bicycle, your school bag.
How marketing
can change the
image of a
product.
What a Loss-
Leader is and how
this affects value
added when
money is lost in
the sale price.
The loss of
customers through
bad customer
service even when
the product is
good.
Cheaper, cleaner process, guaranteed quality, How some
100% Profit to the baker, promotes home
industry, morally right, tastes fresher, paying for regulated by health board, package sealed, more companies benefit
time and effort. people involved in work process. the wider
community as a
value added.
1.1.4 – ADDING AND INCREASING VALUE – TASKS -
HOMEWORK

1. Missing words
Adding value means creating a finished product that is worth more to the
customer than the sum of the parts. At Starbucks, 25p of coffee beans, milk How Branding
and flavourings turns into a selling price of £2.50. The £__________of value links to value
added pays for staff, the equipment, the sofas, the rent and still generates a added
generous _______________. Adding value is the ultimate goal of Research How marketing
and Development teams and marketing departments. It generates the surplus can change the
image of a
that pays the bills. product.
The formula for calculating value added is: ________________ - bought-in
What a Loss-
goods and services. Leader is and how
2. Ways to add value (Match the points A – H to the relevant product type
or types) ? this affects value
added when
money is lost in
Product type Ways to add value Ways to add value the sale price.
1. Car manufacturing A. Obtain a E. Carry out the process The loss of
prestigious address faultlessly customers through
2. Biscuit production B. Measure up, F. Excellent design and styling bad customer
then make to fit service even when
3. Running a private C. Offer a short G. Impressive, prestige the product is
hospital lead time packaging good.
4. Making wedding D. Add a technical H. Use low cost materials How some
dresses innovation where they’re not visible to the companies benefit
customer the wider
community as a
value added.
1.1.4 – ADDING AND INCREASING VALUE – TASKS -
HOMEWORK

3. Calculations
Tardew Car Dealers buys a 6 year old Fiesta for £700 cash. One car seat is replaced
and a new exhaust fitted - the parts cost £105. After a thorough clean-up inside and How Branding
out and a squirt of air freshener inside (materials cost: £5), the Fiesta goes onto the links to value
forecourt at £1,495 and is sold for £1,400 a week later. added
I. Calculate the added value How marketing
II. Explain why this added value cannot be treated as pure profit. can change the
image of a
Strength is a cure for baldness based on herbal medicines. It sells in bottles priced at product.
£24 that provide enough for two weeks. A full cure is said to take one year, though What a Loss-
the packaging says that only 50% of users will find the cure effective. Jenny Ireland, Leader is and how
the inventor of Strength, has hired a well-known TV and film actor to promote the this affects value
product on a series of TV commercials. The production process and costs of Strength added when
are a closely guarded secret, but the materials themselves cost no more than 30p - the money is lost in
the sale price.
same as the packaging. Jenny often refers to the ‘huge overheads’ of running the
business, but with sales of 2 million bottles last year, no wonder she has just bought The loss of
herself a Mercedes sports car. customers through
bad customer
a) Calculate the
service even when
III. value added per bottle the product is
IV. total value added in the last year
b) Give one justification Jenny might find to defend the high price she charges for
Strength.
? good.
How some
companies benefit
the wider
community as a
value added.
1.1.4 – ADDING AND INCREASING VALUE – TASKS -
HOMEWORK

4. Outline one example of:

4.1 Added value based upon deception or cleverness (such as Aero adds value by
blowing air through chocolate) How Branding
__________________________________________________________________ links to value
__________________________________________________________________ added
_____________________________________________ How marketing
___________________________________________________________ can change the
___________________________________________________________ image of a
product.
4.2 Added value based upon a unique selling point (a USP)
__________________________________________________________________ What a Loss-
__________________________________________________________________ Leader is and how
this affects value
_____________________________________________ added when
___________________________________________________________ money is lost in
___________________________________________________________ the sale price.
4.3 TV advertisements you have seen recently that seem focused upon adding The loss of
value customers through
__________________________________________________________________ bad customer
__________________________________________________________________ service even when
_____________________________________________ the product is
___________________________________________________________ good.
___________________________________________________________ How some
Download Word Version to Print Download Answers companies benefit
? the wider
community as a
value added.
1.1.1: BUSINESS ACTIVITY - REVISION
QUESTIONS

1. From the following list, decide which items are human

needs and which are wants:
• Luxury House, Shelter, Coca-Cola, Car, Clean Water,
Designer Jeans, Clothing [3]
2. Explain what is meant by scarcity when referring to the
economic problem [3]
3. List the 4 factors of production and explain briefly and
explain briefly why each is necessary for production to
take place [8]
4. Explain, with the aid of an example, what the term
opportunity cost means to a consumer [3]
5. Give 2 other examples of opportunity cost that would

6.
affect groups other than consumers [2] ?
Explain what is meant by the term division of labour [2]
1.1.1: BUSINESS ACTIVITY - REVISION
QUESTIONS

7. Why is a business likely to increase output if it

adopts division of labour [2]
8. List 4 tasks involved in the making of cakes that
could be given over to different workers through
division of labour [2]
9. State 3 benefits to society of business activity [3]
10. What is meant by added value [2]
11. Identify and explain 2 ways in which a retailer of
clothes could add value to their products. (Hint:
the answer is not to buy more expensive clothes
for the shop as this will not necessarily add
value.) [6]
?